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Analyzing Medivation’s Growth Opportunity with Xtandi

Jillian Dabney

Why Is Medivation a Good Acquisition Target?

Medivation’s growth opportunity with Xtandi

Xtandi is Medivation’s (MDVN) key drug. Currently, it’s approved for mCRPC (metastatic castration-resistant prostate cancer). Additional studies will expand the population base for the drug from the current addressable 73,000 patients in the US to 133,000 patients in the country. It presents an opportunity for the drug to serve another 60,000 patients.

NHT market growth

Xtandi is the preferred NHT (novel hormone therapy). The NHT market consists of Xtandi and Zytiga. The sales grew from $1 billion in 2012 to $4.1 billion in 2015. Xtandi competes directly with Johnson & Johnson’s (JNJ) Zytiga. It surpassed the drug in terms of sales. With the continued growth of the overall NHT market and Xtandi’s increasing market share along with additional indications, the drug would have an addressable market of over $15 billion in sales.

Zytiga and Xtandi dominate the NHT market

Excluding Xtandi and Zytiga, there are three other drugs with proven benefits in the prostate cancer space. These drugs are Dendreon’s (DNDNQ) Provenge, Bayer Healthcare’s Xofigo, and Sanofi’s (SNY) Jevtana. However, the NHT market is dominated by Xtandi and Zytiga. Only these two drugs have “demonstrated both overall survival and progression-free survival benefits in a broad label covering both pre-chemo and post-chemo patients.” Xtandi’s upstream label expansion is comparing the drug with AstraZeneca’s (AZN) Casodex.

Increasing duration of therapy

Another driver behind the drug’s success is its increasing duration of therapy. Medivation expects Xtandi’s duration of therapy to be around 15.3 months in the mCRPC space.

Read Medivation Sees Growth in Xtandi: A Major Oncology Drug and Could Medivation’s Xtandi Become a Major Urology Drug? to learn about more opportunities for the drug.

One of the funds that hold assets such as Medivation in its portfolio is the iShares Nasdaq Biotechnology ETF (IBB). It offers 1.9% weight to Medivation’s stock.

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